A Senate report handed down last week found Commonwealth Bank customers lost hundreds of millions of dollars after financial planners put their clients' money into high-risk investments without their permission.

The Senate report called for a royal commission into the affair.

Mr Narev said the bank's previous performance in financial planning was "unacceptable" and said he was launching a program to compensate people who had lost money.

But he would not say how much money was being put aside for the program, or how many customers could be affected.

"Poor advice provided by some of our advisers between 2003 and 2012 caused financial loss and distress and I am truly sorry for that," he said in a statement.

"We're here today because we ultimately, having listened to the sentiment, looked at our vision to secure and enhance the financial wellbeing of people, businesses and customers and asked ourselves: 'What is the right thing to do?'," he added.

"It may be that we have done that later than we might have, but it's never too late to do the right thing."

The bank has committed to offering a free assessment to customers who received advice from Commonwealth Financial Planning and Financial Wisdom between September 2003 and July 2012.

If that assessment finds the customer received poor advice, an "independent customer advocate" funded by CBA will make a compensation offer.

The bank says it will make available to customers the information it uses to conduct the review and asks customers to provide any information they have to the reviewers.

CBA 'too slow'

The Senate committee looking into CBA's financial planning arm found the bank had, to date, not dealt appropriately with complaints over poor advice and alleged fraudulent practices by some of its planners.

Prime Minister Tony Abbott says the Government is carefully examining the findings of the Senate report but would not say if he supports its recommendation for a royal commission.

"What we need here is protection of mum and dad investors, but we also need maintenance of a market where inevitably people do face a certain amount of risk and it is a question of getting the balance right," he said.

Finance Minister Mathias Cormann put out a statement welcoming CBA's compensation program, and also praised Ian Narev for fronting the media at a press conference on Thursday.

"Beyond the policy issues and the issues for ASIC raised by that inquiry, the most important focus for the Government has been, and continues to be, on achieving a satisfactory resolution of any outstanding and unresolved legitimate issues for aggrieved CBA customers as efficiently and as effectively as possible. The CBA's Open Advice Review Program offers that opportunity," he said.

"The Government will monitor implementation of the Open Advice Review Program as we finalise our response to all 61 recommendations of the Senate Economics Committee Report."

But the Treasurer Joe Hockey - whose mother-in-law was affected by the scandal - says the bank did not act quickly enough to address the problem.

"Clearly the Commonwealth Bank was just too slow to get to this point, and a lot of the anxiety could have been averted if they had moved more quickly," he said.

The Opposition leader Bill Shorten agrees that CBA's response is overdue, and adds that it should not be up to customers to chase the bank for an adequate resolution.

"This is a scandal of shocking proportions. Thousands of people have lost their money for no other reason that they trusted the advice and the institution that provided the advice," he said.

Deeds don't match words says Choice

Consumer group Choice has questioned the sincerity of the bank's apology, given the Commonwealth Bank was among other major financial institutions lobbying for a partial wind back of the previous federal government's Future of Financial Advice (FoFA) legislation.

"If the Commonwealth Bank was truly sorry, they would not have lobbied to remove essential consumer protections for financial advice," Choice chief executive Alan Kirkland said in a statement.

"Just a few weeks ago the Commonwealth Bank wrote to the Government calling for lower standards for financial advisers – this action does not match today's apology."

There are systemic problems, not just at CBA but in the financial advisory industry generally ... that need to be fixed urgently.

Tim Sheehy, CEO Governance Institute of Australia

Choice says regulations introduced by the Coalition Government that came into force this week, and were supported by CBA, have watered down a requirement for financial planners to act in a client's best interests.

"Consumers must be able to feel confident that they are getting impartial financial advice they can trust, and advice should not be clouded by any type of financial incentive that reward them based on how much of a particular product they sell," Mr Kirkland said.

The Governance Institute of Australia, which provides education to company secretaries and corporate risk managers, says there should be a royal commission, as the problems are widespread in the industry.

"CBA's gesture is too little, too late. Their proposed actions may have some impact in lifting the company's internal standards, but what about the rest of the industry and every other financial planning business that gets off scot-free?" argued the institute's chief executive Tim Sheehy.

"There are systemic problems, not just at CBA but in the financial advisory industry generally, relating to professionalism, expertise and conflicts of interest that need to be fixed urgently."